REDWOOD CITY, CA-Locally based Shorenstein Properties LLC has acquired 1400-1500 Seaport Blvd., a pair of connected five-story buildings here for somewhere between $240 million and $250 million, local industry sources tell Completed in 2002, the 447,747-sf development is 100% leased to PDL Biopharma, a biopharmaceutical company that plans to relocate its headquarters and other operations to the buildings later this year from Fremont.

The two buildings are part of the 10-building, 1.7-million-sf Pacific Shores Center, a multi-tenant, 106-acre campus with the amenities of a high-end corporate campus such as Nike’s in Beaverton, OR. The seller, Starwood Capital Group of Greenwich, CT, acquired the overall development from Jay Paul Co. for $825 million or $485 per sf shortly before the start of the year and immediately set out to flip 1400-1500 Seaport, the core nature of which doesn’t mesh with Starwood’s opportunistic strategy.

PDL has committed to lease the two buildings through December 2021. The 164,000-sf building at 1500 Seaport was in shell condition when PDL signed its lease. It is being built out as lab space. The 283,000-sf building at 1400 Seaport, which is being subleased from OpenWave Systems for the first seven years, was already finished and fully furnished and will be used for PDL’s administrative offices. The published triple-net asking rate for 1500 Seaport at the time the lease was signed was $21 per sf per year.

Starwood Capital’s acquisition of Pacific Shores Center included additional development land. Given that, the long-term nature of PDL’s lease and the fact that other buildings in the deal were not fully leased, local industry experts tell that 1400 and 1500 Seaport were likely valued at well more than $500 per sf for Starwood Capital’s acquisition and that Shorenstein’s flip price likely came in somewhere between $540 and $550 per sf. The various parties involved either declined comment on the price or could not be reached for comment.

Shorenstein Properties LLC acquired the two buildings for its eighth investment fund, formed late last year with $1.1 billion in committed capital. Shorenstein represented itself in the transaction. Cornish & Carey and Eastdil Secured represented Starwood.

Backing up to 135-acres of restored wetlands, Pacific Shores is a multi-tenant, 106-acre campus with the amenities of a high-end corporate campus such as Nike’s in Beaverton, OR. The campus includes a 38,000-sf fitness facility with a 25-ft rock climbing wall, a game room and a lap pool, among other things. Additional amenities include baseball and soccer fields, indoor and outdoor volleyball and basketball courts, jogging and biking trails, high-end food service, a day spa and on-site dental service.

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